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(Think Progress)   Hostess: Damn those union thugs for making us go bankrupt. It had to be the unions and not at all us giving our CEO a giant-as-fark raise when we had no money. Yep, that's gotta be it   (thinkprogress.org) divider line 159
    More: Asinine, CEO, Hostess Brands, bankruptcy  
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4609 clicks; posted to Business » on 16 Nov 2012 at 7:26 PM (2 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-11-17 06:02:52 AM  

oren0: I know liberals aren't great at math, but come on. The CEO got an extra $1.8M/year. Hostess had 18,500 employees. So this increase could have been redistributed to all employees, giving each of them $100.

The labor negotiations were over tens of thousands of dollars per employees, or hundreds of millions of dollars overall. Is it OK to get pissed that their CEO got a raise when the company was going under? Absolutely. But as fun as it is to get pissed about CEO pay, any suggestion that his bonus sank the company is mathematically ridiculous.


People skills aren't your strong suit, are they?
 
2012-11-17 06:26:15 AM  

StokeyBob: If you would have been there 37 years ago when everyone was sold on the concept of being paid PLUS a certain amount going towards a retirement fund.

They gave their word. You gave them years of your labor.

If so you might be a little more than miffed at being ripped off days before you need it for retirement.



Things like that are why unfettered Capitalism sucks, IMHO.
 
2012-11-17 06:32:20 AM  

Gunther: OregonVet: Straightening twinkies for 37 years doesn't mean the company should have to pay you 50k/yr until you die after you retire.

You don't even think the corporation should have to pay the pensions they agreed to? Corporations can just refuse to honor contracts if it would be inconvenient for them?


I know that's a satiric rhetorical question, but union-busters would answer honestly, yes, yes they should.
 
2012-11-17 06:36:43 AM  

SockMonkeyHolocaust: Eh, I am a member of the SEIU and I ask myself all the time how much should a janitor or manual laborer or someone doing an easy job that anyone can be trained to do should really make. At what point do you say to a janitor that he really doesn't deserve a 60" TV and a middle class life? I was a pariah during out last strike because I agreed that costs for management are rising so I was prepared to pay a extra for our medical plan. Personally, I am considered "skilled labor" as a building mechanic so I guess that skews my perspective.


That's always been my take on unions, how can you justify some guy making 25 bucks an hour when all he does is tighten the lug nuts on a car tire as it passes by on the assembly line? I could give a rats ass if he's been working there 30 years or not. If people want to earn more money then they should get promoted or learn a more valuable skill.
 
2012-11-17 07:22:46 AM  

ReapTheChaos: So what I get out of this is that it's ok for the unions to bleed a company dry year after year with constant demands for pay raises and benefits but god forbid anyone in management gets a raise.


Actually, it was leveraged debt and declining interest in their unhealthy products that brought Hostess down. The union people knew they were out of a job no matter what, so they lashed out in anger and administered the coup dr grace. This was actually stupid, since it harmed their own future employability, made the union look bad, and provided management with a scapegot for their failure - it was an emotinally motivated call, and they only hurt themselves. They should have just ridden it out - they weren't going to be there much longer anyway.
 
2012-11-17 07:47:28 AM  

oren0: I said that the argument that his pay was the cause of the bankruptcy flies in the face of basic math


It has little to do with math. The pay raise was part of the cause of the bankrupcty. When you're asking people who make an average middle class salary to take a substantial cut to their compensation while you're shifting dollars at the top to give people already living high on the hog a huge raise, the people you're asking to take on the pain are much less likely to think they should listen to you.

It's a negotiation and management went to the table with a weak hand it created for itself. There are myriad reasons the company went bankrupt. This is one of them. It also strongly suggests management is incompetent more generally, which is probably the single biggest reason.
 
2012-11-17 08:16:57 AM  

ReapTheChaos: how can you justify some guy making 25 bucks an hour when all he does is tighten the lug nuts on a car tire as it passes by on the assembly line?


If he tightens the lug nuts on all 4 wheels on a car and does 30 cars an hour, the cost of his labor is 28.3 cents a wheel. Not exactly a lot. If he just tightens the lug nuts on two wheels per car at the rate of 30 cars an hour, the cost of his labor jumps all the way to 41.6 cents per wheel. Also not exactly much.
 
2012-11-17 08:31:53 AM  

veive: oh for fark's sake!

Cost of a pension is around 46%Link and average CEO pay is 10 million Link.

Average CEO pay would work out to $833.34(rounded up!) per year per employee for the 12,000 employees. This guy was making like 10% of average.
Average pension cost would be $11481.60 per year per employee assuming the employees work full time and only make $12 per hour.
Since they were union employees they likely made substantially more so the cost of the pension would likely be higher, but I'm going with a known wage for a factory worker.(He works at the Russell Stover plant in Corsicana, TX which has to managed not go bankrupt.)

Thus a conservative estimate of the pension cost is $11481.60 per employee times 12,000 employees for a total of $137,779,200.00 per year.

Now, I know a lot changes with science every year, so a lot of what I was taught in school is no longer valid, but I'm going to go out on a limb here and say that my math is still good and $2,550,000
If my company were in trouble and struggling to stay in business I'd stop funding pensions too.

And if my employer explained what was happening I'd be OK with keeping my job and losing my pension.
Job without pension > nothing.

Just sayin'


Just sayin'
The punctuation dumb people put at the end of an unsolicited, factless assertion to indicate self satisfaction at having stated something they erroneously believe to be clever, biting, and insightful.
 
2012-11-17 08:32:57 AM  

WhyteRaven74: ReapTheChaos: how can you justify some guy making 25 bucks an hour when all he does is tighten the lug nuts on a car tire as it passes by on the assembly line?

If he tightens the lug nuts on all 4 wheels on a car and does 30 cars an hour, the cost of his labor is 28.3 cents a wheel. Not exactly a lot. If he just tightens the lug nuts on two wheels per car at the rate of 30 cars an hour, the cost of his labor jumps all the way to 41.6 cents per wheel. Also not exactly much.


You seem to have completely missed the point.
 
2012-11-17 08:33:55 AM  

WhyteRaven74: If he tightens the lug nuts on all 4 wheels on a car and does 30 cars an hour, the cost of his labor is 28.3 cents a wheel. Not exactly a lot. If he just tightens the lug nuts on two wheels per car at the rate of 30 cars an hour, the cost of his labor jumps all the way to 41.6 cents per wheel. Also not exactly much.


It's more doublethink.
The executives need more. More money. More bonuses. More benefits. The value they bring to the company justifies their pay.
The laborer doesn't deserve money, bonuses, or benefits. It doesn't matter how much value he brings to the company.

Then the executives biatch when they can't find good workers or the union gets tired of their shiat.
 
2012-11-17 09:00:13 AM  
1). 92% of the rank and file members voted to strike

2). The teamsters themselves advised these idiots to take the deal after examining the books

3). No inventory = no sales = no profits. Who else can you blame but the union members?
 
2012-11-17 09:05:50 AM  

MatrixOutsider: 1). 92% of the rank and file members voted to strike

2). The teamsters themselves advised these idiots to take the deal after examining the books

3). No inventory = no sales = no profits. Who else can you blame but the union members?


Important part bolded and underlined. Yes, it was shiatty of management to give themselves those big raises. However, when the fariking TEAMSTERS say you probably should stop striking, it's time to stop.
 
2012-11-17 09:17:29 AM  

MatrixOutsider: 1). 92% of the rank and file members voted to strike

2). The teamsters themselves advised these idiots to take the deal after examining the books

3). No inventory = no sales = no profits. Who else can you blame but the union members?


The people who leveraged the company into more debt than it could possibly sustain. That is what doomed Hostess.
The union, on the other hand, killed it prematurely - mostly, it appears, out of mere spite. It was a stupid move - they could have had work for maybe as much a s another year, and not brought discredit on themsleves and the union movement. I can see why the teamsters are pissed at them - it was a dumbassed move.
 
2012-11-17 09:34:18 AM  
Actually, companies do that to try and keep top talent through the bankruptcy. The execs get told something to the effect of "We'll give you a pay raise if you stay with us and don't go to another company."
 
2012-11-17 09:38:57 AM  
CSB

I worked at a company that manufactured multi-million dollar automated welding machines. We had to remove a sensor and re-calibrate it. This sensor was behind a panel that was secured with two bolts. I told my co-worker to hand me a wrench and I would hop in and take the plate off. He told me that I would get fired if I did because we had to have a union guy do the wrench turning.

Not wanting to get fired, I let him make the call to the building across the street. They said "We'll send someone over." Three hours later, a guy meanders in, takes the bolts off, and we can get back to work.

A couple hours of testing and calibrating and we had the sensor fixed and back in place, all we had to do was put the cover back in place and we could do a test run. It was about 4:30 PM, and when we called the Certified Wrench Turners Department, no one answered. I wandered over to see if anyone was there, and of course they had all knocked off at 4:00. I went back, told my co-worker, "Fark it...they've already put us 3 hours behind schedule." and tightened the bolts myself.

So yeah, in my experience - unions are counter-productive as all get out. Fark em.

/CSB
 
2012-11-17 09:40:15 AM  

WhyteRaven74: ReapTheChaos: how can you justify some guy making 25 bucks an hour when all he does is tighten the lug nuts on a car tire as it passes by on the assembly line?



================

Another rocket surgeon who knows everything after listening to years of lectures at Limbaugh U.

First, economics: YOU FAIL. Try enrolling in a real university.....no Hollywood Upstairs School of Business doesn't count.....take few courses in economics.

Second, why don't you get back in your time machine and ask Henry Ford. Once upon a time, before the auto industry was unionized, Henry raised the pay of his workers from $1 per day to $5 per day. $5 per day was big money at the time. Why did he do that? Hmmmmmm.

Sell the antique collection of dildos you inherited from your grandfather and buy a plane ticket to Germany. German auto companies pay their workers $67/ hr on average....more than double US auto worker average. German auto makers are ALL unionized, unlike their American counterparts.....unlike their American counterparts, they are also profitable. Go see for yourself.

BTW, you wouldn't last an hour on an auto assembly line. "Mommy, the cars just keep on coming, it never stops! It was like one of Dante's circles of hell! Where's my bottle of oxy?"
 
2012-11-17 09:56:30 AM  

Cloudchaser Sakonige the Red Wolf: Actually, companies do that to try and keep top talent through the bankruptcy.


In most jobs, if you fark up that badly you get fired.
 
2012-11-17 10:06:28 AM  

Sergeant Grumbles: Cloudchaser Sakonige the Red Wolf: Actually, companies do that to try and keep top talent through the bankruptcy.

In most jobs, if you fark up that badly you get fired.


Good point, the BOD of any company in bankruptcy does need to decide who they're going to try to retain and who to let go.

I'm sure that someone 'll buy the brand. I know that the owners of Pabst are considering doing so. So we'll still get to eat Twinkie Weiner Sandwiches while watching UHF
 
2012-11-17 10:30:50 AM  

oren0: I know liberals aren't great at math, but come on. The CEO got an extra $1.8M/year. Hostess had 18,500 employees. So this increase could have been redistributed to all employees, giving each of them $100.

The labor negotiations were over tens of thousands of dollars per employees, or hundreds of millions of dollars overall. Is it OK to get pissed that their CEO got a raise when the company was going under? Absolutely. But as fun as it is to get pissed about CEO pay, any suggestion that his bonus sank the company is mathematically ridiculous.


So how about the other execs that also took in an additional half-mil? Seems like the "haves" became "have-mores" across the board.

This was math you did to make you feel good.
 
2012-11-17 11:03:55 AM  
This isn't just Twinkies and Ho Hos that are abut to go extinct. Hostess also owns/makes (the former) Dolly Madison's Zingers as well as Wonder Bread.

And I wonder if the exec's plan all along was to Bainify the company, and all the strike did was prompt the vampires to speed up the timetable to 3. Profit?
 
2012-11-17 11:05:48 AM  

Cloudchaser Sakonige the Red Wolf: Sergeant Grumbles: Cloudchaser Sakonige the Red Wolf: Actually, companies do that to try and keep top talent through the bankruptcy.

In most jobs, if you fark up that badly you get fired.

Good point, the BOD of any company in bankruptcy does need to decide who they're going to try to retain and who to let go.



Well if they got to bankruptcy I'd say it's probably best not to retain any of them. If you completely failed your job to the point that your department had to be reorganized.........do you think they'd be wondering if they should pay you more?

Probably why companies that file bankruptcy once tend to do it again.
 
2012-11-17 11:06:57 AM  

aspAddict: So yeah, in my experience - unions are counter-productive as all get out. Fark em.


Read this book about what a world without unions looks like:

www.capitalcentury.com
 
2012-11-17 12:49:02 PM  

Sergeant Grumbles: douchebag/hater: The CEO's raise had nothing to due with the bankruptcy and to claim it does is specious.

Maybe it's more about not wanting to work for a boss who gives himself a raise after cutting your pay.


Well, then... I guess it worked out for them after all! Well done.

They shouldn't have any problem finding employment with their considerable twinkie making skills.

No worries, their formidable talents will soon be in high demand. Unless the company that buys the rights in another state or country can get a machine or trained monkey to dump flour into a mixing bowl without having to pay to move this uniquely qualified workforce.
 
2012-11-17 01:11:42 PM  
Didn't the execs say they were cutting their own pay to $1 back in... March?
 
2012-11-17 01:24:17 PM  

Dafatone: Lsherm: FormlessOne: Fark Hostess.

The first time they went bankrupt, the only reason they came out of bankruptcy was through the sufferage of the union workers that took pay cuts, benefit cuts, longer hours, and worked their asses off to save that company. The company repaid them by ignoring them and lavishing bonuses on the management, then tried to screw them when the economy took a downturn. The unions couldn't sacrifice more - they did that the first time.

Then they went bankrupt again, and tried to blame the unions - the folks that actually helped them the first time around - to deflect blame from the assholes that deserve it, the investors who pushed so hard for profit that they cheapened the product, screwed the employees, and stood by while management was rewarded for increasing profitability at the expense of just about everything else.

Fark Hostess. Let 'em burn.

None of that is true.

Can I distrust your link because it's yet another thing that gets the "Twinkie Defense" wrong?


The link is utter bullshiat, but we know that already given its source.
 
2012-11-17 01:55:10 PM  
Ever notice that union bosses never miss a meal or a paycheck, while workers and families go unemployed and hungry?
There's your 1%
 
2012-11-17 02:21:36 PM  

Fissile: WhyteRaven74: ReapTheChaos: how can you justify some guy making 25 bucks an hour when all he does is tighten the lug nuts on a car tire as it passes by on the assembly line?


================

Another rocket surgeon who knows everything after listening to years of lectures at Limbaugh U.

First, economics: YOU FAIL. Try enrolling in a real university.....no Hollywood Upstairs School of Business doesn't count.....take few courses in economics.

Second, why don't you get back in your time machine and ask Henry Ford. Once upon a time, before the auto industry was unionized, Henry raised the pay of his workers from $1 per day to $5 per day. $5 per day was big money at the time. Why did he do that? Hmmmmmm.

Sell the antique collection of dildos you inherited from your grandfather and buy a plane ticket to Germany. German auto companies pay their workers $67/ hr on average....more than double US auto worker average. German auto makers are ALL unionized, unlike their American counterparts.....unlike their American counterparts, they are also profitable. Go see for yourself.

BTW, you wouldn't last an hour on an auto assembly line. "Mommy, the cars just keep on coming, it never stops! It was like one of Dante's circles of hell! Where's my bottle of oxy?"


This made my morning.
 
2012-11-17 03:51:11 PM  

ReapTheChaos: You seem to have completely missed the point.


No I got the point. When looking at labor costs it's labor cost per unit produced or some quantity of units produced that matters.
 
2012-11-17 04:10:21 PM  

Sergeant Grumbles: CujoQuarrel: In any case you need to fully fund your 401k no matter how much it hurts.

Ha, on my salary? With my student loans? Fat farking chance. I still enjoy eating every once in a while, even if it is 10 cent Ramen.


Agreed.

That idea of fully funding a 401k for many workers is about as out of touch as Rmoney's "borrow money from your dad to start your business".

Many people are living paycheck to paycheck and can't afford a big hit to their budget to invest with.  This isn't "will I take my vacation in Cancun this year, or fund my 401k and just go Myrtle Beach" or ""Will I buy a Mercedes, or fully fund my 401k and buy a Ford", this is "Will I eat and put gas in the tank of the car, or fully fund my 401k and try to live off ramen noodles and hitchhike to work?"

Isn't the whole idea of a pension over a 401k that the investments get done by professionals, and that if everybody pools their money that larger and more profitable investments can be made?

A 401k is just a glorified way of ripping employees off by taking away a concrete benefit (pension) and replacing it with "you're on your own" with a tiny sop of a tax write-off (useless for lower incomes) and a break on the price of stock investments (still not worth if if you have trouble buying the shares to begin with).
 
2012-11-17 05:04:28 PM  

James!: It's the Bain plan, your debtors can't go after what you've paid out in salaries so you bleed the company coffers into your upper management and throw the blame on someone else.


Sounds like it was a democrat 'Bain plan.' LOL.

http://www.zerohedge.com/news/2012-11-16/hostess-liquidation-curious- c ast-characters-twinkie-tumbles
 
2012-11-17 05:41:51 PM  
It is their money. They should do whatever the fark they want with it. Oh, and why are we still talking about Bain Capital?
 
2012-11-17 06:20:01 PM  

oren0: I know liberals aren't great at math, but come on. The CEO got an extra $1.8M/year. Hostess had 18,500 employees. So this increase could have been redistributed to all employees, giving each of them $100.

The labor negotiations were over tens of thousands of dollars per employees, or hundreds of millions of dollars overall. Is it OK to get pissed that their CEO got a raise when the company was going under? Absolutely. But as fun as it is to get pissed about CEO pay, any suggestion that his bonus sank the company is mathematically ridiculous.



It's kinda like Mike Tyson owning an exotic pets zoo with albino tigers. Is it singlehandedly the reason why he blew through $100 million dollars in ten years? No. However, the fact that he thought it would be a good idea to have "pets" who do nothing but sit in a cage and eat thousands of dollars worth of meat a month indicates someone who has no farkin clue how to handle money.



Did a million dollar CEO raise while the company was in financial straits single handedly sink the company? No. Is it a sign of utter incompetence and a predatory attitude by it's management? Yes.
 
2012-11-17 06:33:05 PM  

Silverstaff: I have never understood how a 401k is anything other than an elaborate scheme to rip-off employees and tell them its their own fault.


Well, lets see if there is anything in your post to explain why you don't understand the benefits foof a 401k...


At the only job I worked that had a 401k, it worked like this:
You are barely making a living wage, you don't make enough money to do anything other than commute to work, pay your essential bills, and eat just enough food to keep from starving.


Oh, I see you have a shiat job and likely are not equipped with marketable job skills that are in demand.

The problem isn't 401k plans, it is you.
 
2012-11-17 07:18:30 PM  
Maybe 2.5 b gross. 820 m in heavily leveraged debt. But yeah - the union put them out of business.
This was a company run into the ground by the boneheads who were running it.
 
2012-11-17 07:20:45 PM  

Lsherm: seanpg71: If they didn't bother to actually fund the pension, they've been effectively underpaying you on your agreed upon compensation for years.

Pension economics are incredibly complicated, but most follow the same structure as social security - current employees and revenues pay for current retirees. Obviously, this all falls apart if the company goes out of business.

Pensions are hardly ever "fully funded" because the math to make them work is bullshiat. What should happen is a pension fund is funded, dollar for dollar, based on promises made to the employees. Instead, companies and governments use fuzzy math based on unknown future revenues to assume the pensions are funded.

And when funding a pension ahead of time actually does happen, like in the case with the USPS, people biatch about it for good reason: it's painful and it can bankrupt a company.


There is a reason ponzi schemes are illegal....
 
2012-11-17 07:27:39 PM  

Hunter_Worthington: hahaha, ah, thanks Libtards. Your bizarre continuing support for Organized Labor gives me endless joy.

Organized Labor got what it deserved here. They tried extorting the company for more then they were worth, and lost "their" jobs.

So, they ran GM, Ford, Chrysler, Bethlehem Steel, into the ground, nearly sank Boeing, Caterpillar, and U.S. Steel, and now added Twinkie the Kid to their scalp.

ohh! plus, they helped bring us the high quality public education system for which the U.S. is known world over.

//man, I almost couldn't type that last one without laughing.
//any defeat for Labor is a victory for America.


Glad I am niy the only one keeping score. To be fair they were not always harmful. They did create a culture change in industry that increased pay to something reasonable at first and got the jobsite safer. After they did that, they went all derpy and started asking for 75$ per hour in total compensation to turn a screw or pick up a box.
 
2012-11-17 08:37:41 PM  

jst3p: Oh, I see you have a shiat job and likely are not equipped with marketable job skills that are in demand.

The problem isn't 401k plans, it is you.


Well, let's see. . .

When I got the job, it was in 2007, you know, when the job market crashed hard and nobody could find work. Try finding a job circa Spring 2007 as a recent college graduate.

I had 2 B.A.'s (History and Political Science), with job experience working in tech support and legal research/legal secretary work, could type 75 words per minute, and spoke fluent Spanish and Japanese.

Didn't matter. No jobs out there at all. I spent almost a year hunting for any job I could find, anything. Started with stuff I had experience and training for, but despite hundreds of applications and a few dozen interviews, they went nowhere. I got desperate enough that I wasn't above flipping burgers, but even retail and food service weren't immediately hiring. Working in that shiathole of a call center wasn't the bright spot of my career, but it paid the bills (barely).

As for now? I've done a lot in the 4 years since I left that job. I've got skills, I've got credentials, I still believe 401k is a joke and an actual pension is something far more trustworthy. I've never seen anything to change my mind about them. I'll trust my military pension and my police retirement pension far more than I'll trust the bad joke that is 401k.
 
2012-11-17 08:54:08 PM  
Well yeah, you are talking government pensions. Of course that's stabler-er than say my situation where I'd be putting money into a pension fund that is run by a union that even by the standards of unions is considered "corrupt".

Not everyone can score a government job and in my case I am on my second 401k after having to wipe out my original one to survive. So this is my best chance at having a somewhat liveable retirement besides praying to a god I don't believe exists that my parents pay off their houses before they die. Also, I have to hope that the swings of the market doesn't repeat the last 10 years when I want to or have to retire. Whole lotta people can't retire.
 
2012-11-17 08:59:43 PM  
And quick googling brings us to a Wall Street Journal article about the SEIU

Mr. Stern's "middle class" spin would be more believable if the SEIU did more for its own members, especially their pensions. Public records based on the SEIU's own filings show that the SEIU National Industry Pension plan - which covers some 101,000 workers - was only 75% funded in 2006. Put another way, the plan had only three-fourths of the money it needs to meet its retirement obligations. And the national chapter is only the start. Some 13 local SEIU pension plans in 2006 were less than 80% funded; several didn't reach 65%.

So yeah. I wouldn't trust my pension to buy me a quart of milk in 30 years.
 
2012-11-17 09:12:25 PM  
It is absolutely incredible how ignorance has shown its head yet again. Unions were forged as an answer to some of the most horrendous working conditions, to cordon outrageous management demands, and to tamper horrible abuse.

Things I'll throw on the table:

Pinkertons

The Triangle Shirtwaist factory fire

Child Labor

Thanks to Unions you have a five day workweek, relative income equality, employer health-based coverage and the Family and Medical Leave Act.

Like all things, those that hold power, including unions, need Balance. Outrageous and abusive behavior, no matter who's wielding it, tends to result in Pyrrhic victories. For all the Randian idiots on this thread, yes, I first acknowledge that abuse held by anyone leads to ruin. That said and done, crack open a farking history book and learn all about the fantastic and healthy working conditions of the Industrial Revolution. Morgan, Edison, Carnegie and the rest didn't suddenly have a burst of empathy about their workers, rights had to be fought for, and won.

Giving the keys blindly, to ANYONE, with the hopes they'll do the right thing is absolute wishful thinking. Add money to it, and you might as well go walking in traffic. Blindly following dogma while waving your dick in the street is the best way to get run over.

I refuse to believe that so many educated people represented in this thread would purposely choose to act so stupidly. Nothing's solved by shouting slogans or sides.
 
2012-11-17 09:20:44 PM  
So what you're saying is that unions haven't done anything recently, say, in the last 100 years to justify their existence?
 
2012-11-17 09:24:10 PM  
I am saying, that those who choose to take advantage, do so. And that there will always be a need to keep people on the straight and narrow. You don't get a singular dose of antibodies when one is born do you?

No. Your immune system fights for life until the end. Likewise, if it goes out of control, the very things protecting you can kill.

Don't be so bloody idiotic.
 
2012-11-17 09:52:33 PM  

Smelly McUgly: fark Hostess. They mismanaged the company and gave themselves bonuses, and then they want to take a pound of flesh from the workers to pay for it.

Just another awful company. Hopefully a better one springs up in their wake.


Bonuses aren't what sunk the company. People just don't want to eat as many Twinkies and other crap as they used to. Now you have a billion dollars in pension debt and no (or a greatly reduced) market for your products.

Not having read their books, I won't make any assertions about how they should have managed their money, as far as saving for pensions. I will, however, state that perhaps it would have been a good idea to diversify into healthier alternative snacks.
 
2012-11-17 10:01:49 PM  

SockMonkeyHolocaust: And quick googling brings us to a Wall Street Journal article about the SEIU

Mr. Stern's "middle class" spin would be more believable if the SEIU did more for its own members, especially their pensions. Public records based on the SEIU's own filings show that the SEIU National Industry Pension plan - which covers some 101,000 workers - was only 75% funded in 2006. Put another way, the plan had only three-fourths of the money it needs to meet its retirement obligations. And the national chapter is only the start. Some 13 local SEIU pension plans in 2006 were less than 80% funded; several didn't reach 65%.

So yeah. I wouldn't trust my pension to buy me a quart of milk in 30 years.


The "X% funded" number isn't as straight forward as it seems. When a fund is 100% funded it means that if everyone eligible for a pension started collecting today, there would be enough money for all of them. That will never happen, since it would require all people vested in the pension but not at retirement age to retire on disability simultaniously.

A 75% funded pension might be a little low, but not outrageously so. 100% means that the fund can absorb the absolute maximum possible draw while still fully meeting obligations. Which, short of an entire workforce getting maimed at the same time, simply won't happen.
 
2012-11-17 10:28:58 PM  

Aikidogamer: Hunter_Worthington: hahaha, ah, thanks Libtards. Your bizarre continuing support for Organized Labor gives me endless joy.

Organized Labor got what it deserved here. They tried extorting the company for more then they were worth, and lost "their" jobs.

So, they ran GM, Ford, Chrysler, Bethlehem Steel, into the ground, nearly sank Boeing, Caterpillar, and U.S. Steel, and now added Twinkie the Kid to their scalp.

ohh! plus, they helped bring us the high quality public education system for which the U.S. is known world over.

//man, I almost couldn't type that last one without laughing.
//any defeat for Labor is a victory for America.

Glad I am niy the only one keeping score. To be fair they were not always harmful. They did create a culture change in industry that increased pay to something reasonable at first and got the jobsite safer. After they did that, they went all derpy and started asking for 75$ per hour in total compensation to turn a screw or pick up a box.


I don't think an individual worker's pay is really the issue. The true issue is that the Union (ie the actually guys who run the union, not the individual workers) want as many members as possible. Thus they implement all sorts of asinine rules dictating who can do what job (one of the linked articles pointed out how the teamsters had rules that different drivers were needed for different products) meaning that you end up with several guys standing around and one guy working far too often rather than everyone actually working all the time and having a much larger workforce than is actually necessary.
 
2012-11-17 11:31:43 PM  

Sergeant Grumbles: Cloudchaser Sakonige the Red Wolf: Actually, companies do that to try and keep top talent through the bankruptcy.

In most jobs, if you fark up that badly you get fired.


It depends whether you were responsible for whatever decisions caused the problems that caused the bankruptcy (in this case apparently an overpaid and overpensioned workforce)

In this instance, they did can the old CEO and the guy who made $1.8m was brought in this March.
 
2012-11-17 11:39:44 PM  

Fissile: WhyteRaven74: ReapTheChaos: how can you justify some guy making 25 bucks an hour when all he does is tighten the lug nuts on a car tire as it passes by on the assembly line?


================

Another rocket surgeon who knows everything after listening to years of lectures at Limbaugh U.

First, economics: YOU FAIL. Try enrolling in a real university.....no Hollywood Upstairs School of Business doesn't count.....take few courses in economics.

Second, why don't you get back in your time machine and ask Henry Ford. Once upon a time, before the auto industry was unionized, Henry raised the pay of his workers from $1 per day to $5 per day. $5 per day was big money at the time. Why did he do that? Hmmmmmm.

Sell the antique collection of dildos you inherited from your grandfather and buy a plane ticket to Germany. German auto companies pay their workers $67/ hr on average....more than double US auto worker average. German auto makers are ALL unionized, unlike their American counterparts.....unlike their American counterparts, they are also profitable. Go see for yourself.

BTW, you wouldn't last an hour on an auto assembly line. "Mommy, the cars just keep on coming, it never stops! It was like one of Dante's circles of hell! Where's my bottle of oxy?"


So you are saying that the guy SHOULD get $25 per hour because of Henry Ford or Germany or something? Both of those are irrelevant.

The only reason some guy should get $25 per hour for turning lugnuts is if nobody else can do it as well for $24 per hour.
 
2012-11-17 11:43:00 PM  

WhyteRaven74: gothelder: 3 or 4 of these incidents and the "executive elite" would damn well get the point that the corporations well being is more important to their compensation.

a funner alternative, give the company to the employees.


Why don't they buy it? Then they could pay themselves whatever they think is an appropriate wage.
 
2012-11-18 12:21:23 AM  

Debeo Summa Credo: It depends whether you were responsible for whatever decisions caused the problems that caused the bankruptcy


There's that double standard again. Executives aren't responsible for anything if their entire company fails and they're off the hook for it.
 
2012-11-18 02:41:46 AM  

WhyteRaven74: Lsherm: None of that is true.

if Hostess hadn't been so badly run it had to file for bankruptcy protection before, it's all academic. As it is their previous acquisitions dumped more debt on the books than they could deal with. Then when they were bankrupt they picked up more debt. And obligations to a private equity firm on top of that debt. And their management never got better, if anything it got worse.


Their management got WAY worse. The Hostess problem was systemic a decade ago, and the firm they hired to "turn things around" couldn't even begin to fix it, but they didn't help by lowering the quality of the product at the exact same time the market for their product was tanking. They also kept prices the same.

Frankly, Hostess was screwed ten years ago. The first Chapter 11 bankruptcy in 2004 was exited in 2009 because of "growth projections" for the company that were absolute nonsense given the state of the economy. Hostess agreed to labor costs they couldn't afford, even with the labor cuts, and they agreed to loan payments they couldn't make unless the business grew every year. None of that happened.

You keep harping on the private equity firm, but they aren't the reason the money flow stopped. It's the two hedge funds that lent the money in 2004, 2009, and again in 2010 to keep the company running. The private equity firm was running the company and they are going to take a bath on this because the hedge funds are first in line to get paid back. The PE firm won't get anything. Neither will the employees. 

It's nice to think that all PE firms are like Bain and get paid out no matter what, but that's only if they use their own money. In Hostess's case, it looks like the company was purchased with other funds, operated with other funds, and everybody is going to lose. But most importantly, the PE firm is going to lose because they are last in line behind the two hedge funds that ponied up the money in the first place. Liquidation sales will go to them first.
 
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